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Brian Pennington

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Ransomware

Breaches caused by either hacking or malware nearly doubled in relative frequency

Beazley, a leading provider of data breach response insurance, today released its Beazley Breach Insights 2016 findings based on its response to over 2,000 breaches in the past two years. The specialized Beazley Breach Response (BBR) Services unit responded to 60% more data breaches in 2015 compared to 2014, with a concentration of incidents in the healthcare, financial services and higher education sectors.

Key data:

  • Breaches caused by either hacking or malware nearly doubled in relative frequency over the past year. In 2015, 32% of all incidents were caused by hacking or malware vs. 18% in 2014.
  • Unintended disclosure of records – such as a misdirected email – accounted for 24% of all breaches in 2015, which is down from 32% in 2014.
  • The loss of non-electronic physical records accounted for 16% of all breaches in 2015, which is unchanged from 2014.
  • The proportion of breaches involving third party vendors more than tripled over the same period, rising from 6% of breaches in 2014 to 18% of breaches in 2015.

Beazley’s data breach statistics are based on 777 incidents in 2014 and 1,249 in 2015.

We saw a significant rise in incidents caused by hacking or malware in the past year,” said Katherine Keefe, global head of BBR Services. This was especially noticeable in healthcare where the percentage of data breaches caused by hacking or malware more than doubled

Ransomware on the rise in healthcare

Hackers are increasingly employing ransomware to lock up an organization’s data, holding it until a ransom is paid in nearly untraceable Bitcoin. Hollywood Presbyterian Hospital in Los Angeles reported suffering a ransomware attack in February 2016 and ultimately paid the hackers $17,000 in Bitcoin. A year earlier, the FBI had issued an alert warning that ransomware attacks were on the rise.

This trend is borne out by Beazley’s data. Breaches involving ransomware among Beazley clients more than doubled to 43 in 2015 and the trend appears to be accelerating in 2016. Based on figures for the first two months of the year, ransomware attacks are projected to increase by 250% in 2016.

Clearly, new malware programs, including ransomware, are having a big impact, said Paul Nikhinson, privacy breach response services manager for BBR Services. Hacking or malware was the leading cause of data breaches in the healthcare industry in 2015, representing 27% of all breaches, more than physical loss at 20%

Healthcare is a big target for hackers because of the richness of medical records for identity theft and other crimes. In fact, a medical record is worth over 16 times more than a credit card record.”

Higher Education

Higher education also experienced an increase in breaches due to hacking or malware with these accounting for 35% of incidents in 2015, up from 26% in 2015.

Colleges and universities are reporting increased “spear phishing” incidents in which hackers send personalized, legitimate-looking emails with harmful links or attachments. The relatively open nature of campus IT systems, widespread use of social media by students and a lack of the restrictive controls common in many corporate settings make higher education institutions particularly vulnerable to data breaches.

Financial Services

In the financial services sector, hacking or malware was up modestly to 27% of industry data breaches in 2015 versus 23% in 2014. Trojan programs continued to be a popular hacking device.

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Payment Card Industry issues new guidance to help organizations respond to data breaches

For any organization connected to the internet, it is not a question of if but when their business will be under attack, according to a recent cybersecurity report from Symantec, which found Canada ranked No. 4 worldwide in terms of ransomware and social media attacks last year. These increasing attacks put customer information, and especially payment data at risk for compromise.

When breaches do occur, response time continues to be a challenge. In more than one quarter of all breaches investigated worldwide in 2014 by Verizon, it took victim organization weeks, or even months, to contain the breaches. It is against this backdrop that global cybersecurity, payment technology and data forensics experts are gathering in Vancouver for the annual PCI North America Community Meeting to address the ongoing challenge of protecting consumer payment information from criminals, and new best practices on how organizations can best prepare for responding to a data breach. 

A data breach now costs organizations an average total of $3.8 million. However, research shows that having an incident response team in place can create significant savings. Developed in collaboration with the Payment Card Industry (PCI) Forensic Investigators (PFI) community, Responding to a Data Breach: A How-to Guide for Incident Management provides merchants and service providers with key recommendations for being prepared to react quickly if a breach is suspected, and specifically what to do contain damage, and facilitate an effective investigation. 

The silver lining to high profile breaches that have occurred is that there is a new sense of urgency that is translating into security vigilance from the top down, forcing businesses to prioritize and make data security business-as-usual,” said PCI SSC General Manager Stephen W. Orfei. “Prevention, detection and response are always going to be the three legs of data protection. Better detection will certainly improve response time and the ability to mitigate attacks, but managing the impact and damage of compromise comes down to preparation, having a plan in place and the right investments in technology, training and partnerships to support it

This guidance is especially important given that in over 95% of breaches it is an external party that informs the compromised organization of the breach,” added PCI SSC International Director Jeremy King. “Knowing what to do, who to contact and how to manage the early stages of the breach is critical

At its annual North America Community Meeting in Vancouver this week, the PCI Security Standards Council will discuss these best practices in the context of today’s threat and breach landscape, along with other standards and resources the industry is developing to help businesses protect their customer payment data. Keynote speaker cybersecurity blogger Brian Krebs will provide insights into the latest attacks and breaches, while PCI Forensic Investigators and authors of the Verizon Data Breach Investigation Report and PCI Compliance Report, will present key findings from their work with breached entities globally. Canadian organizations including City of Calgary, Interac and Rogers will share regional perspectives on implementing payment security technologies and best practices. 

Download a copy of Responding to a Data Breach: A How-to Guide for Incident Management here 

The original PCI SSC press release can be found here.

Workers Ignoring Known Cyber Risks, Surfing Adult Content and Downloading Unapproved Apps

Blue Coat Systems global survey of 1580 respondents across 11 countries highlights a global trend of employees ignoring cyber risks while at work. Results from the survey found that universally, workers visit inappropriate websites while at work despite typically being fully aware of the risks to their companies.

Blue Coat’s research, conducted by independent research firm Vanson Bourne, found the actions of employees at odds with their awareness of the growing cyber threats facing the workplace. In addition, this risky behaviour can leave both sensitive corporate and personal data open to being stolen and used immediately, stored for future use, or sold into a thriving black market where compromised corporate and personal identities are traded globally.

One source of cyber threats is the practice of phishing. Cyber criminals continuously conduct extensive research on employees’ social profiles to find information that can be used to attack organizations. For example, an attacker may create a seemingly personalized email targeted at an IT administrator for a large enterprise using information found on social media profiles, such as the recipient’s alma mater or favourite sports team. That email may contain malware that is downloaded once the recipient clicks on a link included in the document.

Pornography continues to be one of the most popular methods of hiding malware or malicious content. Even though awareness is high of the threat posed by adult content sites, workers are still visiting these potentially dangerous sites.

The Blue Coat survey found that at 19%, China has the worst record for viewing adult content sites on a work device, with Mexico (10%) and the UK (9%) not far behind. 

Survey Highlights

The majority of global survey participants admitted understanding the obvious cyber threats when downloading email attachments from an unknown sender, or using social media and unapproved apps from corporate networks without permission, but knowing this, did not curb their risk-taking.

Other findings include:

  • 65% of global respondents view using a new application without the IT department’s consent as a serious cyber-security risk to the business, 26% admitted doing so.
  • 37% of respondents in Singapore used new applications without IT’s permission, compared to 33% in the UK and 30% in India and Mexico. On the flip side, Australia and France were the lowest offenders at 14% and 16% respectively; however, any number puts businesses at risk.
  • Obvious behaviours such as opening emails from unverified senders still happen at work. 29% of Chinese employees open email attachments from unverified senders, even though 72% see it as a serious risk. US businesses view the threat even more seriously (80%) and open less unsolicited emails (17%).
  • 41% use social media sites for personal reasons at work, a serious risk to businesses, as cyber criminals hide malware on shortened links and exploit encrypted traffic to deliver payloads.
  • 6% of global respondents still admitted viewing adult content on work devices, China ranked as the worst offender with 19% employees admitting to viewing adult content at work, compared to Australia and Germany, both at 2%

While the majority of employees are aware of cyber security risks, in practice most still take chances,” said Dr. Hugh Thompson, CTO for Blue Coat. “The consumerization of IT and social media carry mixed blessings to enterprises. It is no longer realistic to prevent employees from using them, so businesses need to find ways to support these technology choices while simultaneously mitigating the security risks

The European Cybercrime Centre – one year on

What are the main future cybercrime threats on the horizon? And how has the European Cybercrime Center (EC3) contributed to protect European citizens and businesses since its launch in January 2013? 

These questions are at the core of an EC3 report presented today, and discussed at a conference organised by the Commission, with participants from law enforcement authorities, national and EU institutions and the private sector.

Criminal behaviour is changing fast, exploiting technological developments and legal loopholes. Criminals will continue to be creative and deploy sophisticated attacks to make more money, and we must be able to keep up with them. The expertise of the EC3 is helping us to fight this battle and boost European cooperation. Through several successful, far-reaching operations in the past year, the European Cybercrime Centre has already earned well-deserved fame amongst law enforcement agencies”, said Commissioner for Home Affairs Cecilia Malmström.

Troels Örting, Head of the European Cybercrime Centre added: “In the 12 months since EC3 opened we have been extremely busy helping EU law enforcement authorities to prevent and investigate cross-border cybercrime. I am proud and satisfied with our results so far, however we cannot rest on our laurels. I am especially worried about the increasingly complex forms of malware that are surfacing, along with more technologically advanced cyber-scams, and the so-called ‘sextortion’ of minors. We have only seen the tip of the iceberg, but EC3, backed by our valued stakeholders and partners, is dedicated to supporting Member States’ future frontline cybercrime operations.

According to a recent Eurobarometer

  • 12% of European internet users have had their social media or email account hacked
  • 7% have been the victim of credit card or banking fraud online

EC3 achievement highlights

The main task of the European Cybercrime Centre is to disrupt the operations of organised crime networks that commit serious and organised cybercrime (for more details, see MEMO/13/6 and infographics).Concretely, the EC3 supports and coordinates operations and investigations conducted by Member States’ authorities in several areas. Recent examples include:

High-tech crimes (cyber-attacks, malware)

In its first year, the EC3 assisted in the coordination of 19 major cybercrime operations, for instance: 

  • Two major international investigations (Ransom and Ransom II) were concluded, related to so-called Police Ransomware – a type of malware that blocks the victim’s computer, accusing the victim of having visited illegal websites containing child abuse material or other illegal activity. Criminals request the payment of a “fine” to unblock the victim’s computer, making the Ransomware look as if it comes from a legitimate law enforcement agency. Cybercriminals convince the victim to pay the ‘fine’ of around €100 through two types of payment gateways – virtual and anonymous. The criminals investigated by EC3 infected tens of thousands of computers worldwide, bringing in profits in excess of one million euros per year. 13 arrests were made (mainly in Spain) and the networks were broken up.
  • EC3 has also supported several international initiatives in the areas of botnet takedowns, disruption and investigation of criminal forums and malware attacks against financial institutions, such as the recent takedown of the ZeroAccess botnet together with Microsoft and high-tech crime units from the German BKA, Netherlands, Latvia, Luxembourg and Switzerland.

Online child sexual exploitation

At present, EC3 supports 9 large child sexual exploitation police operations within the European Union. In the first year of EC3, significant efforts – jointly with many Member States and non-EU cooperation partners – were put into combating the illegal activities of paedophiles engaged in the online sexual exploitation of children using hidden services.

EC3 is involved in many operations and joint investigations targeting the production and distribution of child abuse material on various internet platforms. It is providing ongoing operational and analytical support to investigations on the dark net, where paedophiles trade in illicit child abuse material in hidden forums, as well as to investigations into ‘sextortion’. Sextortion is the term given to the phenomenon where child abusers gain access to inappropriate pictures of minors and use the images to coerce victims into further acts or the abuser will forward the images to family and friends of the victim.

Payment fraud

The EC3 is currently providing operational and analytical support to 16 investigations, regarding payment fraud. In 2013 it supported investigations resulting in three different international networks of credit card fraudsters being dismantled: 

  • One operation led to the arrest of 29 suspects who had made a 9 million Euro profit by compromising the payment credentials of 30,000 credit card holders. 
  • The second network that was tackled resulted in 44 arrests during the operation (which followed 15 previous arrests; 59 arrests in total) in several Member States, two illegal workshops for producing devices and software to manipulate Point-of-Sale terminals dismantled, illegal electronic equipment, financial data, cloned cards, and cash seized. The organised crime group had affected approximately 36.000 bank/credit card holders in 16 European countries. 
  • The third operation targeted an Asian criminal network responsible for illegal transactions and the purchasing of airline tickets. Two members of the criminal gang, travelling on false documents, were arrested at Helsinki airport. Around 15,000 compromised credit card numbers were found on seized computers. The network had been using card details stolen from cardholders worldwide. In Europe, over 70,000 euros in losses were suffered by card holders and banks. 
  • An operation against airline fraudsters using fraudulent credit cards to purchase airline tickets was coordinated by the EC3 in 38 airports from 16 European countries. During the operation, more than 200 suspicious transactions were reported by the industry and 43 individuals were arrested (followed by another 74 arrests after the action day; 117 arrests in total). These were all found to be linked to other criminal activities, such as the distribution of credit card data via the internet, intrusions into financial institutions’ databases, other suspicious transactions, drug trafficking, human smuggling, counterfeit documents including IDs, and other types of fraud. Some of those detained were already wanted by judicial authorities under European Arrest Warrants.

Future threats and trends in cybercrime

Currently, around 2, 5 billion people worldwide have access to the internet and estimates suggest that around another 1, 5 billion people will gain access in the next four years. As our online life, with all its immense advantages, will continue to grow, so will our exposure to online crime. In its first yearly report, the EC3 looks at future cybercrime threats and trends. Among others, it points to the following: 

Growing ranks of criminals. The threshold for stepping into the business of cybercrime is becoming very low. Already now, a complete underground economy has developed, where all sorts of criminal products and services are traded, including, drugs, weapons, hired killings, stolen payment credentials and child abuse. Any kind of cybercrime can be procured even without technical skills – password cracking, hacking, tailor-made malware or DDoS attacks.

More demand. It is expected that the demand for and use of cybercrime services will increase, resulting in an even stronger growth of the development, testing and distribution of malware; building and deployment of botnets; theft and trade in payment credentials as well as money laundering services.

Increased sophistication. The development of more aggressive and resistant types of malware is expected. This includes ransomware with more advanced encryption complexity; more resilient botnets; and banking malware and Trojans with advanced sophistication, in order to circumvent protection measures by financial institutions.

Even more global. Due to rapidly spreading internet connectivity, cybercrime originating in Southeast Asia, Africa and South America will grow.

Going mobile. A shift of malware development is expected towards the operation on, and distribution through, mobile devices.

Smarter distribution. New ways of distributing aggressive and resistant types of malware are expected in the coming years. There is also an increasing, worrying trend of offering child abuse through live streaming, which leaves police without evidence unless intercepted at the time of transmission.

Increased need for money-laundering. Criminals will seek easy ways of cashing and laundering profits. Targeting large numbers of citizens and small to mid-sized companies for relatively small amounts is a scenario likely to continue. But also the use of payment credentials for online purchases will grow. The demand for e-currencies and other anonymous payment systems will rise further.

Targeting of cloud services. The hacking of cloud services becomes more and more interesting for criminals. It is expected that criminals will increasingly aim at hacking such services for the purpose of spying, retrieval of credentials and extortion.

To address these developments and fight a crime that by its very nature knows no borders or jurisdictions, the EC3 will continue to provide operational support to law enforcement agencies from EU Member States and from non-EU cooperation partners. It will further develop its expertise in training and capacity building, strategic analysis and digital forensic support.

Reproduced from http://europa.eu/index_en.htm

RSA’s December Online Fraud Report 2012 including an excellent piece on Ransomware

RSA’s December Online Fraud Report delivers the results from RSA’s fraud monitoring centre, a summary of their report is below. 

Ransomware is a type of Trojan/malware that can lock files on an infected machine and restrict access to the computer unless the user pays a “ransom” for the restrictions to be removed

Infection campaigns and methods used by Ransomware are identical to those used for any other malware/Trojan infection. For example, recent Ransomware campaigns infected users via the Blackhole exploit kit; another campaign relied on drive-by-downloads via malicious tags in news sites and forums. 

Ransomware campaigns can take on a variety of forms. One of the most common scams is using fake anti-virus programs, making a user believe their computer is infected with unwanted software that can only be removed by purchasing the attacker’s special anti-virus program. However, Ransomware campaigns can take on a number of forms including bogus messages from law enforcement or even a recent example in Australia where a medical clinic’s patient records were targeted unless the clinic paid the attackers $4,200. 

Although victims are promised their files will be unlocked once they pay the “fine”, in most cases the botmaster cannot control the infected bot and the files/computer will remain locked (depending on the malware’s function). 

In order for criminals to remain untraceable, Ransomware payments must be kept anonymous and these Trojans’ operators prefer prepaid payment cards/vouchers (available at retail locations in the US, Europe and now in Arabic-speaking countries as well). It appears that Ransomware is a flourishing business in the cybercrime arena since this type of malware has been proliferating, and attack numbers are on the rise. Ransomware is so popular that although this Winlock type malware can come as a standalone piece, nowadays it is often coupled with other Trojan infections to add monetization schemes to new and existing botnets. Ransom components are sold as ‘plugins’ for some of the well-known banking Trojans including Citadel, Carberp, ICE IX, Zeus, and SpyEye. 

New commercial Ransomware

A recent variant analyzed by RSA researchers revealed a new type of Ransomware, dubbed “Multi-Locker” by its operators. This malware appears to be a commercial creation, destined for sale to cybercriminals interested in launching infection campaigns to spread it. The Multi-Locker ransom and botnet administration control panel were written by a Russian-speaking blackhat, based on a peer’s existing code (the “Silent locker” Trojan). Much like other known Ransomware codes, the malware comes with adapted HTML lock pages designed to appear per each user’s IP address’ geo-location. The pages display in the corresponding language, naming the local national police and demanding ransom in the local currency ($/€/£/other) via prepaid cards/vouchers available in that country.

Multi-Locker is available to cybercriminals through a vendor in underground fraud communities. The malware was announced in the underground in the beginning of October 2012 and offered for sale at USD $899 per kit. In the ad, the vendor guarantees the locking of files on Windows-based machines running any version of Windows, from 2003 to Windows 8. 

Most ransom Trojans to date have been designed to accept prepaid cards or vouchers issued in the US and Europe. Multi-Locker’s vendors are adding their research regarding prepaid media used in Arabic-speaking countries and assure buyers that they will enrich their knowledge to enable them to easily cash out the funds at the end of the line. 

Multi-locker Botnet and control panel

Unlike the majority of ransom Trojans, the Multi-Locker Ransomware was designed with a main point of control that can manage some of the activity of infected bots. The basic control interface shows botmasters some basic statistics such as the total number of bots on that botnet and the payments that come in from each bot. The botnet interface parses each payment made according to the prepaid card type the victim provides.

The panel also displays the botnet’s conversion rate (how many successful infections/ locks out of the entire campaign) at any given moment by showing the total number of lock pages loaded versus the number of bots (that ratio hovering around 20%). 

New features coming soon: DNS-Locker

The most interesting module this Trojan offers is apparently yet to come: DNS Internet Locker. The DNS Locker will be a restriction that will take over the Internet browser, forcing to only display the Ransomware Operator’s HTML lock page, demanding payment for the browser to be released. 

The vendor is very boastful about having researched solutions online and having found none that can help infected users find a way to rid their machines from the malware, adding that even starting the computer in sage mode will not remedy the lock, guaranteeing the future DNS Locker will work on even the newest versions of Windows. 

RSA’s Conclusion

Ransomware were first seen coming from Russia 2005-6 and have since evolved in terms of tactics and scope. Ransomware Malware is particularly lucrative to botmasters operating out of Eastern Europe as almost all were written by Russian-Speaking coders and sold by Russian-Speaking vendors in the Fraud Underground.

Ransomware’s success rate may differ in each country/geography, according to the number of users who decide for the unlocking of the PC. Unfortunately the numbers for this type of attack continue to grow as online users are not very aware of the threat and may attempt to resolve the issue on their own by providing payment to the botmasters.

Phishing Attacks per Month

In November, RSA identified 41,834 unique phishing attacks launched worldwide, making a 24% increase in attack volumes from October. The growth in attacks in November is mostly attributed to the online holiday shopping season as fraudsters try to leverage this time of year to lure victims.

Number of Brands Attacked

In November, 284 brands were targeted in phishing attacks, marking a 6% decrease from October. Of the 284 brands attacked 45% endured 5 attacks or less.

US Bank Types Attacked

Nationwide banks continued to be the most targeted by phishing in November, experienced nearly 80% of all attack volumes.

Top Countries by Attack Volume

In November the US was targeted by 42% of total phishing volume. The U.K accounted for 20% of the attack volume, with India emerging as the third most targeted by volume with 7% of all global attacks. India replaced Canada who saw a significant decrease, from 27% of total attack volumes in October to just 4% in November.

Top Countries by Attacked Brands

In November, the countries that featured the greatest number of targeted brands were the U.S. (30%), still leading by a wide margin, followed by the UK with 11%. Though absorbing a relatively small number of attacks in November, Brazilian brands ranked third of the most targeted with 6%, attesting to the diversity of attacked brands in the country.

Top Hosting Countries

Despite a 6% drop in the month prior, the U.S. continues to be the top hosting country for phishing attacks; one out of every two attacks in November was hosted in the U.S. France was the second top host, accounting for 7% of phishing attacks in November, most of which were hosted by a single ISP.

You might also want to read “What will fraud look like in 2013?”

Previous RSA Online Fraud Report Summaries:

  • The RSA November 2012 Online Fraud Report Summary here.
  • The RSA October 2012 Online Fraud Report Summary here.
  • The RSA September 2012 Online Fraud Report Summary here.
  • The RSA August 2012 Online Fraud Report Summary here.
  • The RSA July 2012 Online Fraud Report Summary here.
  • The RSA June 2012 Online Fraud Report Summary here.
  • The RSA April 2012 Online Fraud Report Summary here.
  • The RSA March 2012 Online Fraud Report Summary here.
  • The RSA February 2012 Online Fraud Report Summary here.
  • The RSA January 2012 Online Fraud Report Summary is here.
  • The RSA December 2011 Online Fraud Report Summary is here.
  • The RSA November 2011 Online Fraud Report Summary is here.
  • The RSA October 2011 Online Fraud Report Summary is here.
  • The RSA September 2011 Online Fraud Report Summary is here.

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6 Experts predict the IT security and compliance issues and trends for 2013

Everyone has an opinion on what could be around the corner, some are based on extensive research and market trends, and some are based on customer expectations and experience.

Rather than bore you with my predictions I thought I would extract the predictions of several vendors and a distributor and put them into one single post so it is easier to see trends and when we get to the end of the year we can see if they were right.

The 6 specialist predictors this year are from the following organisations:

  1. Wick Hill
  2. Websense
  3. WatchGuard
  4. Kaspersky
  5. Fortinet
  6. Sophos

Wick Hill Group’s Ian Kilpatrick delivers his top five trends for 2013

  1. BYOD. “BYOD was arguably the biggest buzz word of 2012 and is now an unstoppable, user-driven wave which will continue to make a major impact on the IT world in 2013 and beyond. Smartphones, tablets and laptops all come under this category, as well as desktop PCs used remotely from home. BYOD is a transformative technology and 2013 will see companies trying to integrate it into their networks. While tactical needs will drive integration, strategic requirements will become increasingly important.
  2. Mobile Device Management. The very rapid growth of mobile devices such as smartphones, tablets and laptops, but particularly smartphones, led to concerns about their management and security in 2012. With employees using their smartphones for both business and personal use, the security and management issues became blurred. Mobile Device Management solutions were a strong growth area in 2012, which will accelerate in 2013.
  3. High density wireless. Wireless requirements have been significantly incrementing over the last year and this trend will continue in 2013. BYOD has changed both the data transfer and performance expectations of users.
  4. Data back-up and recovery. While large organisations have always been at the forefront of back-up and recovery, data centres and big data have put significant demands on them during 2012. Alongside that, smaller organisations have been under immense pressures from ever increasing data volumes, archiving and compliance requirements.
  5. Data leakage protection. With growing volumes of data and with regulatory bodies increasingly prepared to levy fines for various non-compliance issues, data leakage protection will continue to be a major cause for concern during 2013. Companies will be looking closely at how to secure and manage their data as their network boundaries spread even wider, with increased use of social networking and BYOD, increased remote access, the rapid growth of wireless, increased virtualisation and the move towards convergence.

Websense’s 2013 Security Predictions (the link also contains a video clip explaining the predictions).

  1. Cross-Platform Threats. Mobile devices will be the new target for cross-platform threats.
  2. Malware in App Stores. Legitimate mobile app stores will host more malware in 2013
  3. Government-sponsored attacks. Government-sponsored attacks will increase as new players enter.
  4. Bypass of Sandbox Detection. Cybercriminals will use bypass methods to avoid traditional sandbox detection
  5. Next Level Hacktivists. Expect Hacktivists to move to the next level as simplistic opportunities dwindle
  6. Malicious Emails. Malicious emails are making a comeback.
  7. CMS Attacks. Cybercriminals will follow the crowds to legitimate content management systems and web platforms.

WatchGuard Technologies reveals its annual security predictions for 2013

  1. A Cyber Attack Results in a Human Death
  2. Malware Enters the Matrix through a Virtual Door
  3. It’s Your Browser – Not Your System – that Malware Is After
  4. Strike Back Gets a Lot of Lip Service, but Does Little Good
  5. We’ll pay for Our Lack of IPv6 Expertise
  6. Android Pick Pockets Try to Empty Mobile Wallets

Additionally WatchGuard believes:

  1. An Exploit Sold on the “Vulnerability Market” Becomes the Next APT
  2. Important Cyber Security-Related Legislation Finally Becomes Law

“2012 was an eye-opening year in cyber security as we saw the number of new and more sophisticated vulnerabilities rise, impacting individuals, businesses and governments,” said WatchGuard Director of Security Strategy Corey Nachreiner, a Certified Information Systems Security Professional (CISSP). “This is a year where the security stakes reach new heights, attacks become more frequent and unfortunately more damaging as many organizations suffer attacks before taking measures to protect themselves from the bad guys.”

Kaspersky Lab’s Key Security Predictions for 2013

The most notable predictions for the next year include the continued rise of targeted attacks, cyber-espionage and nation-state cyber-attacks, the evolving role of hacktivism, the development of controversial “legal” surveillance tools and the increase in cybercriminal attacks targeting cloud-based services

  1. Targeted attacks on businesses have only become a prevalent threat within the last two years. Kaspersky Lab expects the amount of targeted attacks, with the purpose of cyber-espionage, to continue in 2013 and beyond, becoming the most significant threat for businesses. Another trend that will likely impact companies and governments is the continued rise of “hacktivism” and its concomitant politically-motivated cyber-attacks.
  2. State-sponsored cyber warfare will undoubtedly continue in 2013. These attacks will affect not only government institutions, but also businesses and critical infrastructure facilities.
  3. In 2012 an on-going debate took place on whether or not governments should develop and use specific surveillance software to monitor suspects in criminal investigations. Kaspersky Lab predicts that 2013 will build on this issue as governments create or purchase additional monitoring tools to enhance the surveillance of individuals, which will extend beyond wiretapping phones to enabling secret access to targeted mobile devices. Government-backed surveillance tools in the cyber environment will most likely continue to evolve, as law-enforcement agencies try to stay one step ahead of cybercriminals. At the same time, controversial issues about civil liberties and consumer privacy associated with the tools will also continue to be raised.
  4. Development of social networks, and, unfortunately, new threats that affect both consumers and businesses have drastically changed the perception of online privacy and trust. As consumers understand that a significant portion of their personal data is handed over to online services, the question is whether or not they trust them. Such confidence has already been shaken following the wake of major password leaks from some of the most popular web services such as Dropbox and LinkedIn. The value of personal data – for both cybercriminals and legitimate businesses – is destined to grow significantly in the near future.
  5. 2012 has been the year of the explosive growth of mobile malware, with cybercriminals’ primary focus being the Android platform, as it was the most popular and widely used. In 2013 we are likely to see a new alarming trend – the use of vulnerabilities to extend “drive-by download” attacks on mobile devices. This means that personal and corporate data stored on smartphones and tablets will be targeted as frequently as it is targeted on traditional computers. For the same reasons (rising popularity), new sophisticated attacks will be performed against owners of Apple devices as well.
  6. As vulnerabilities in mobile devices become an increasing threat for users, computer application and program vulnerabilities will continue to be exploited on PCs. Kaspersky Lab named 2012 the year of Java vulnerabilities, and in 2013 Java will continue to be exploited by cybercriminals on a massive scale. However, although Java will continue to be a target for exploits, the importance of Adobe Flash and Adobe Reader as malware gateways will decrease as the latest versions include automated update systems for patching security vulnerabilities.

Costin Raiu, Director of Global Research & Analysis Team Kaspersky Lab said, “In our previous reports we categorised 2011 as the year of explosive growth of new cyber threats. The most notable incidents of 2012 have been revealing and shaping the future of cyber security. We expect the next year to be packed with high-profile attacks on consumers, businesses and governments alike, and to see the first signs of notable attacks against the critical industrial infrastructure. The most notable trends of 2013 will be new example of cyber warfare operations, increasing targeted attacks on businesses and new, sophisticated mobile threats.”

Fortinet’s FortiGuard Labs Reveals 2013 Top 6 Threat Predictions

  1. APTs Target Individuals through Mobile Platforms. APTs also known as Advanced Persistent Threats are defined by their ability to use sophisticated technology and multiple methods and vectors to reach specific targets to obtain sensitive or classified information. The most recent examples include Stuxnet, Flame and Gauss. In 2013 we predict we’ll see APTs targeted at the civilian population, which includes CEOs, celebrities and political figures. Verifying this prediction will be difficult, however, because after attackers get the information they’re looking for, they can quietly remove the malware from a target device before the victim realizes that an attack has even occurred. What’s more, individuals who do discover they have been victims of an APT will likely not report the attack to the media. Because these attacks will first affect individuals and not directly critical infrastructure, governments or public companies, some types of information being targeted will be different. Attackers will look for information they can leverage for criminal activities such as blackmail; threatening to leak information unless payment is received.
  2. Two Factor Authentication Replaces Single Password Sign on Security Model. The password-only security model is dead. Easily downloadable tools today can crack a simple four or five character password in only a few minutes. Using new cloud-based password cracking tools, attackers can attempt 300 million different passwords in only 20 minutes at a cost of less than $20 USD. Criminals can now easily compromise even a strong alpha-numeric password with special characters during a typical lunch hour. Stored credentials encrypted in databases (often breached through Web portals and SQL injection), along with wireless security (WPA2) will be popular cracking targets using such cloud services. We predict next year we’ll see an increase in businesses implementing some form of two-factor authentication for their employees and customers. This will consist of a Web-based login that will require a user password along with a secondary password that will either arrive through a user’s mobile device or a standalone security token. While it’s true that we’ve seen the botnet Zitmo recently crack two-factor authentication on Android devices and RSA’s SecurID security token (hacked in 2011), this type of one-two punch is still the most effective method for securing online activities.
  3. Exploits to Target Machine-to-Machine (M2M) Communications. Machine-to-machine (M2M) communication refers to technologies that allow both wireless and wired systems to communicate with other devices of the same ability. It could be a refrigerator that communicates with a home server to notify a resident that it’s time to buy milk and eggs, it could be an airport camera that takes a photo of a person’s face and cross references the image with a database of known terrorists, or it could be a medical device that regulates oxygen to an accident victim and then alerts hospital staff when that person’s heart rate drops below a certain threshold. While the practical technological possibilities of M2M are inspiring as it has the potential to remove human error from so many situations, there are still too many questions surrounding how to best secure it. We predict next year we will see the first instance of M2M hacking that has not been exploited historically, most likely in a platform related to national security such as a weapons development facility. This will likely happen by poisoning information streams that transverse the M2M channel — making one machine mishandle the poisoned information, creating a vulnerability and thus allowing an attacker access at this vulnerable point.
  4. Exploits Circumvent the Sandbox. Sandboxing is a practice often employed by security technology to separate running programs and applications so that malicious code cannot transfer from one process (i.e. a document reader) to another (i.e. the operating system). Several vendors including Adobe and Apple have taken this approach and more are likely to follow. As this technology gets put in place, attackers are naturally going to try to circumvent it. FortiGuard Labs has already seen a few exploits that can break out of virtual machine (VM) and sandboxed environments, such as the Adobe Reader X vulnerability. The most recent sandboxing exploits have either remained in stealth mode (suggesting that the malware code is still currently under development and test) or have actively attempted to circumvent both technologies. Next year we expect to see innovative exploit code that is designed to circumvent sandbox environments specifically used by security appliances and mobile devices.
  5. Cross Platform Botnets In 2012. FortiGuard Labs analyzed mobile botnets such as Zitmo and found they have many of the same features and functionality of traditional PC botnets. In 2013, the team predicts that thanks to this feature parity between platforms, we’ll begin to see new forms of Direct Denial of Service (DDoS) attacks that will leverage both PC and mobile devices simultaneously. For example, an infected mobile device and PC will share the same command and control (C&C) server and attack protocol, and act on command at the same time, thus enhancing a botnet empire. What would once be two separate botnets running on the PC and a mobile operating system such as Android will now become one monolithic botnet operating over multiple types of endpoints.
  6. Mobile Malware Growth Closes in on Laptop and Desktop PCs. Malware is being written today for both mobile devices and notebook/laptop PCs. Historically, however, the majority of development efforts have been directed at PCs simply for the fact that there are so many of them in circulation, and PCs have been around a much longer time. For perspective, FortiGuard Labs researchers currently monitor approximately 50,000 mobile malware samples, as opposed to the millions they are monitoring for the PC. The researchers have already observed a significant increase in mobile malware volume and believe that this skewing is about to change even more dramatically starting next year. This is due to the fact that there are currently more mobile phones on the market than laptop or desktop PCs, and users are abandoning these traditional platforms in favor of newer, smaller tablet devices. While FortiGuard Labs researchers believe it will still take several more years before the number of malware samples equals what they see on PCs, the team believes we are going to see accelerated malware growth on mobile devices because malware creators know that securing mobile devices today is currently more complicated than securing traditional PCs.

Sophos think the following five trends will factor into the IT security landscape in 2013

  1. Basic web server mistakes. In 2012 we saw an increase in SQL injection hacks of web servers and databases to steal large volumes of user names and passwords. Targets have ranged from small to large enterprises with motives both political and financial. With the uptick in these kinds of credential-based extractions, IT professionals will need to pay equal attention to protecting both their computers as well as their web server environment
  2. More “irreversible” malware. In 2012 we saw a surge in popularity and quality of ransomware malware, which encrypts your data and holds it for ransom. The availability of public key cryptography and clever command and control mechanisms has made it exceptionally hard, if not impossible to reverse the damage. Over the coming year we expect to see more attacks which, for IT professionals, will place a greater focus on behavioral protection mechanisms as well as system hardening and backup/restore procedures
  3. Attack toolkits with premium features. Over the past 12 months we have observed significant investment by cybercriminals in toolkits like the Blackhole exploit kit. They’ve built in features such as scriptable web services, APIs, malware quality assurance platforms, anti-forensics, slick reporting interfaces, and self protection mechanisms. In the coming year we will likely see a continued evolution in the maturation of these kits replete with premium features that appear to make access to high quality malicious code even simpler and comprehensive
  4. Better exploit mitigation. Even as the number of vulnerabilities appeared to increase in 2012—including every Java plugin released for the past eight years—exploiting them became more difficult as operating systems modernized and hardened. The ready availability of DEP, ASLR, sandboxing, more restricted mobile platforms and new trusted boot mechanisms (among others) made exploitation more challenging. While we’re not expecting exploits to simply disappear, we could see this decrease in vulnerability exploits offset by a sharp rise in social engineering attacks across a wide array of platforms
  5. Integration, privacy and security challenges. In the past year mobile devices and applications like social media became more integrated. New technologies—like near field communication (NFC) being integrated in to these platforms—and increasingly creative use of GPS to connect our digital and physical lives means that there are new opportunities for cybercriminals to compromise our security or privacy. This trend is identifiable not just for mobile devices, but computing in general. In the coming year watch for new examples of attacks built on these technologies.

Sophos “The last word, Security really is about more than Microsoft. The PC remains the biggest target for malicious code today, yet criminals have created effective fake antivirus attacks for the Mac. Malware creators are also targeting mobile devices as we experience a whole new set of operating systems with different security models and attack vectors. Our efforts must focus on protecting and empowering end users—no matter what platform, device, or operating system they choose”

For a retrospective view why not ready my post from last year “7 experts predict the IT security and compliance issues and trends of 2012

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RSA’s September Online Fraud Report 2012 including a summary of rogue mobile apps

In their September Online Fraud Report RSA reports on the activity of online fraudsters, a summary is below

Threats and risks in today’s mobile app marketplace

In terms of mobile security, some mobile application (app) platforms, such as Apple’s AppStore, are known to employ strict rules to which application developers are obliged to adhere.

Other mobile app platforms, such as Android’s Google Play, are more flexible with regards to mobile apps. While providing application developers with a programming platform that is optimized for convenience and ease-of-entry into the app marketplace, it is these very qualities that have made Android the most heavily targeted mobile operating system, with Android apps by far the most widely used vehicle for spreading mobile malware.

Apps are one of the driving forces behind today’s smartphone market. Their download to mobile phones makes them an attractive new attack vector for cybercriminals along with other mobile phone attributes: the shortened URL, low security awareness among users, and the ease of copying a mobile webpage’s layout for malicious purposes.

This risk extends to the corporate setting with companies increasingly adopting Bring- Your-Own-Device (BYOD) policies, in which employees’ devices double as platforms for both personal and work-related communications. Apps that intercept a mobile user’s email and phone communications for example, may gain access to corporate communications, as well.

Types of Rogue App Payloads

According to a research study on Android malware conducted by the Department of Computer Science at North Carolina State University, 86% of Android mobile-malware payloads are repackaged with legitimate apps and are not standalone, making their detection more difficult. The same study found that many others piggyback on genuine app updates to remain undetected.

The payloads these apps install after being downloaded to a device vary widely, and can include:

  • SMS Sniffers. Apps that covertly collect SMS text messages, including passwords sent to users’ handsets, and forward this information to a remote drop point. Some of these include other stealth features to avoid raising the user’s suspicion, for example, functionality that turns off the alarm sound when new text messages are received and hides all incoming messages
  • Premium dialers. Apps that install themselves on the user’s handset and start dialing phone numbers or sending dummy text messages to premium-rate service numbers. This type of operation requires the setup of a bogus merchant, along with a fraudulent merchant ID through which cybercriminals can collect funds unwittingly siphoned out of user’s accounts. Handset owners would only become aware of the scam when seeing their bill the following month
  • SEO enhancers. Apps that repeatedly access a certain website, or websites, to increase their rankings in search engine’s results
  • Ransomware. Apps that lock a user’s handset and demand payment from users in return for relinquishing control of the mobile device
  • Spyware. Apps that send the attacker or spy (via a remote drop point) information garnered from a victim’s device including GPS data, intercepted calls and text messages, and phone contacts
  • Botnet clients / Bridgeheads. Apps that communicate with a cybercriminal via a command & control (C&C) server. These may be used as infrastructure for further malware downloads, much like ready-made PC botnets whose infected systems await to download banker Trojans or other malware pushed from the C&C server. These payloads act as a bridgehead by giving the perpetrator an initial foothold on the compromised device. The payload opens a port on the device, and listens for new commands issued from the fraudster’s C&C point. Later on, an encrypted payload may be downloaded to the user’s device

Android apps and their exploitation

At the end of H2 2012, Google announced that the number of devices running Android has reached 400 million, representing 59% of the world’s smartphone market. And to date, Android’s open source code platform has led to the publication of over 600,000 mobile apps. Android’s source code is based on the Java programming language, and its ease of use and low publisher entry fee has made it the most widely targeted mobile platform by malware developers, and the most widely attacked by today’s Trojans. The increased risk for Android app users has already led several anti-virus companies to release AV software for Android-run devices.

A Secure Venue for Apps

The official venue for Android applications is called “Google Play” (formerly known as “Android Market”). By default, each handset running Android is configured to exclusively allow the installation of apps downloaded from Google Play, and to block installation of apps downloaded from any other venue. This is to ensure a minimal level of security.

Downloading apps from Google Play provides an extra security benefit to Android users, as the store provides a “Remote Application Removal” feature, which allows apps that are retrospectively identified by Google as being malicious to be removed from relevant users’ handsets.

Another important security feature added to Google Play is “Google Bouncer,” which scans new apps, acting as a gatekeeper to keep out those identified as malicious.

Despite Android’s default Google-Play-only settings, Android users can still choose to install apps from venues other than Google Play by manually changing their devices’ security settings. Aware of the security issues this may raise, Android users are presented with a warning message when selecting this option.

Android App Permissions

As a second security measure, prior to the installation of an Android app on most Android-based OSs, the app requests certain system permissions, all which have to be approved before the app can be installed on the device. Whereas legitimate apps normally request only one or two permissions, rogue apps are known to request a long list of permissions before installing themselves.

Currently, this is the main security obstacle for rogue Android apps, which some Trojan coders have managed to bypass through socially engineered schemes. For example, RSA has previously detected a mobile-malware app (SMS sniffer), which presented itself as security software. The app requested nine different permissions, including permission to boot the handset, change system settings, and send text messages. Unsurprisingly, the app was offered from a standalone domain not affiliated with any app store.

RSA’s Conclusion

Today, the payload app may remain on a device even after the host app (with which it was downloaded) has been removed. This makes initial detection and removal of the app from the app store that proffers it even more crucial.

As with PC-based malware, educating consumers to raise awareness of today’s mobile threats and urging them to take precautions against rogue apps, will be of paramount importance to mitigating mobile threats in years to come.

Phishing Attacks per Month

In August, 49,488 unique phishing attacks were identified by RSA, marking a 17% decrease from July. The bulk of this decrease is a result of fewer phishing campaigns launched against European financial institutions which have accounted for significant spikes in recent months.

Number of Brands Attacked

In August, 290 brands were subject to phishing attacks, marking a 20% increase from July. This considerable increase shows that cybercriminals are expanding their phishing targets wider, to new organizations and new industries not targeted in recent months. More than half of the brands affected by phishing in August were targeted by more than five phishing attacks.

US Bank Types Attacked

In the U.S. financial sector, nationwide banks experienced a 7% decrease in phishing attacks. However, brands in this segment continue to be most targeted by phishing attacks, hit by two out of every three attacks in August.

Top Countries by Attack Volume

In August, the UK continued to get hit by the majority of worldwide phishing attack volume for the sixth consecutive month, accounting for about 70% of all global phishing volume. The U.S. and Canada continued to remain second and third on the list.

Top Countries by Attacked Brands

In August, the U.S., UK and Australia were the top three countries whose brands were most affected by phishing, targeted by 45% of global phishing attacks during the month.

Top Hosting Countries

The U.S. hosted the vast majority of phishing attacks in August with 80%, followed by Canada, the UK and Germany.

Previous RSA Online Fraud Report Summaries:

  • The RSA August 2012 Online Fraud Report Summary here.
  • The RSA July 2012 Online Fraud Report Summary here.
  • The RSA June 2012 Online Fraud Report Summary here.
  • The RSA April 2012 Online Fraud Report Summary here.
  • The RSA March 2012 Online Fraud Report Summary here.
  • The RSA February 2012 Online Fraud Report Summary here.
  • The RSA January 2012 Online Fraud Report Summary is here.
  • The RSA December 2011 Online Fraud Report Summary is here.
  • The RSA November 2011 Online Fraud Report Summary is here.
  • The RSA October 2011 Online Fraud Report Summary is here.
  • The RSA September 2011 Online Fraud Report Summary is here.

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RSA’s June Online Fraud Report 2012

In their June Online Fraud Report RSA reports on the activity of online fraudsters, full summary below.

RSA researchers have been following Ransomware campaigns and Ransomware Trojan attack waves and have recently analyzed a new variant that holds infected PCs hostage until their owners make a €100 payment to the botmaster.

Ransomware is the type of malware that can infect a PC and then lock the user’s data most commonly by encrypting files or by injecting a rogue MBR (master boot record) to the system’s start-up routine.

Ransomware can come as standalone malicious code or coupled with other malware. This type of malicious campaign has been on the rise and are ever popular, with many recent cases combining banking Trojans with Ransomware. While the user’s files are typically locked until the ransom is paid, the victim is still free to browse the Internet, thus allowing the banking Trojan to continue collecting information on the victim uninterrupted.

The Trojan involved in the cases studied by RSA is a Ransomware that begins by checking for the future victim’s geo-location and adapting a ransom page to the local language for thirteen different countries. The fact that this malware aims at 13 specific countries may seem targeted enough at first sight, but it is only the case of one variant – if this malware is shared or sold with other criminals, they could easily adapt it to their own targets.

RSA researchers were able to recognize 13 different ransom kits available for this Trojan. All kits are located in the same folder, where some countries have two different types of images that can be downloaded and used by the Ransomware (in cases when more than one language is spoken in that country, such as Belgium).

After the Ransomware kit infected the PC, it was downloaded and unpacked locally. This is the point at which the Trojan begins its primary communication with the botmaster’s remote server.

The communication includes three main purposes:

  1. Inform the botmaster of the addition of a new bot, send infected machine’s IP address (and then used to define the infected PC’s physical location)
  2. Obtain a blacklist of potentially fake prepaid card/voucher numbers defined by the botmaster
  3. Ping the botmaster to use the C&C as a drop for the coming ransom payment (in the shape of a card PIN/voucher number)

This Trojan also makes a few copies of itself and saves them under different names locally on the infected PC.

Much like other Trojans, this Ransomware is managed via server side scripts on the botmaster’s resources. The variant analyzed in this case used four resources, all of which were located on the same physical server, using two different IP addresses held with a Russian-based ISP – typical for the vast majority of Ransomware.

RSA was able to deduce that the Ransomware analyzed is actually part of a larger cybercrime operation. The botmasters behind this malware variant are clearly bot-herding and monetizing their botnets using a loader Trojan, banking Trojans and Ransomware variants. The server hosting the Ransomware has proven to also be a drop zone for stolen credentials amounting to well over €80,000.

RSA Conclusion

Ransomware has been gaining speed among cybercriminals and bot-herders, likely because this extortion method works and keeps paying off, as victims believe that if they pay, their system will be unlocked.

With ransom amounts averaging €100, it seems as though botmasters behind these scams keep the fee relatively low, possibly so that the victim may prefer to pay it in hopes of releasing the hold on their PC rather than contact a support professional. Another factor keeping victims quiet are typical Ransomware accusations, including things such as software and music infringement. It is very possible that users do not know they were infected by malware and are not keen on contacting someone about it, thus allowing this type of malware to enjoy its continued popularity.

Phishing Attacks per Month

In May 2012, phishing volume increased by 7%, with a total of 37,878 global attacks identified by RSA. The bulk of the increase observed in the past two months is a result of highly targeted phishing campaigns launched against a small number of financial institutions.

Number of Brands Attacked

The number of brands targeted by phishing attacks throughout May increased by 4%, and 50% endured less than five attacks.

Types Attacked

Phishing attacks against U.S. nationwide bank brands decreased by 20% while credit unions saw a 13% increase in phishing volume in May.

Top Countries by Attack Volume

After being targeted by 28% of worldwide attacks in April, Canada saw a huge drop in attack volume in May to just 3%. The UK remains the most heavily targeted country for the third consecutive month, enduring more than 60% of global phishing volume in May.

Top Countries by Attacked Brands

The countries with the most attacked brands in May were the U.S., UK, and Australia, accounting for 47% of all phishing attacks. Brands in Brazil, India, Canada, China, France and Italy also continue to remain highly targeted by phishing.

Top Hosting Countries

The U.S. saw an increase of10% in the number of phishing attacks it hosted in May – increasing to 66%, or two out of every three attacks. Brazil also remained a top host with 9% and Germany with 4%.

Previous RSA Online Fraud Report Summaries:

  • The RSA April 2012 Online Fraud Report Summary here.
  • The RSA March 2012 Online Fraud Report Summary here.
  • The RSA February 2012 Online Fraud Report Summary here.
  • The RSA January 2012 Online Fraud Report Summary is here.
  • The RSA December 2011 Online Fraud Report Summary is here.
  • The RSA November 2011 Online Fraud Report Summary is here.
  • The RSA October 2011 Online Fraud Report Summary is here.
  • The RSA September 2011 Online Fraud Report Summary is here.

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